Derek's Company Was Bidding on the Construction of a New

question 55

Multiple Choice

Derek's company was bidding on the construction of a new penguin display at a world-famous zoo. When putting together his bid, Derek began by determining what the zoo would be willing to pay for the structure, and then subtracting a reasonable profit for the company. The result would be the cost of production. For example: If price to zoo = $6 million, and company profit margin = $2 million, the cost to produce cannot exceed $4 million. [$6 million - $2 million = $4 million.] The demand-based pricing strategy in this example is called ___________.

• A) target costing
• B) penetration pricing
• C) cost-based pricing
• D) volume pricing

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Definitions:

Trust

The firm belief in the reliability, truth, or ability of someone or something.

Granting

The act of giving or allowing something as a concession or recognition, often used in the context of rights, privileges, or permissions.

Leader-member Exchange

Describes the dynamic and unique relationships that form between leaders and their individual followers, potentially influencing performance and satisfaction.

Follower Role Orientation

An individual's attitude or behavior in response to the leadership or direction of others.